finally some real two way action

It was great to see some two way action this week after the Bernanke speak on Wednesday putting in at least a short term top in the indices. At this point the uptrend remains fully in tact and I don’t think theres any question there but this week at a minimum did give us our first warning sign, albeit a small one. It was a good week for my trading account as I was able to get some nice short positions in on wednesday which basically made my week. I look forward to the potential vol entering the markets. Now onto the charts.

$SPY finished off the week with a double bottom at 164 and closed on the highs of the day making fridays low a good spot to manage long positions against. The moving averages are trying to curl up here as the bulls march higher to retest thursdays highs that I do believe we will break above early next week but the true test will come in around the 167.5 level which coincide with 61.8% retrace of this last leg down. It seems likely that bulls who did not sell the highs last wednesday might be quick to pull the trigger on their longs after seeing such a hard rug pull. All in all there are some good levels & targets to work against this week.


$AAPL given the weakness we saw in the indices wednesday/thursday apple held in damn well. If sellers were really pent up in this name i believe we would have easily seen a retest of the 420 lows. A break above and out of this flag and I believe we’re in motion to retest the 463ish highs we made a couple weeks back. On the other hand If the bottom falls out of this triangle the 420 low is an obvious level to trade too. I hold no position but i remain bullish on apple in the intermediate term (several week outlook).


$GOOG selling pressure picked up this week after the all important $900 psyche level was broken. On higher timeframes this was all but due for some profit taking and now I would need to see continued basing to take place before stepping in to the long side. The easier trade on this timeframe is continue to short the rips and ride the downtrend (if thats your cup o tea). The moving averages are still sharply sloped down indicating the ball remains in the bears court. Let these level off before taking longs, take a look at my $NFLX chart to see what I mean.


$NFLX catching its footing this week after breaking 235. Bulls stepped in and reversed this hard off 221 and continued sideways in a healthy fashion. Longs can shoot against wednesdays lows and I would expect a retest of the breakdown early next week. I remain bullish.


$FB personally I’m pretty surprised the bulls continue to be MIA from this stock. It continues lower in an orderly fashion and nothing in this chart suggests otherwise. Moving averages continue sharply lower and until something changes continue to short the rips and ride the trend lower. I still believe we could see  see a high volume reversal day anytime around these prices but i’ve said that in the last few updates and we still have not gotten it. It’s an avoid for me but shorts are getting paid.


$AMZN Similar to the broad indices amazon saw a nice tradable double tomorrow around 259 and it’s racing back to retest 263ish and that should be a tough hurdle for the bulls. I suspect we’re going to carve out a range and larger base between 258 and 263 this week before a larger move takes shape. Ranges are a bit too tight for me around these prices so unless we see an explosive move this won’t be high on my watch list this coming week.


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Evan Medeiros

Evan is the founder of the Trade Risk. With 25 years of coding experience and a B.S. in computer science, Evan brings a systematic discipline to investing in the stock market.

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